Tuesday, April 11, 2017

FCC PROPOSES SPECIAL FUNDRAISING RULE FOR RELIGIOUS NONCOMS – PUBLIC RADIO IS REDLINED OUT

FCC Chairman Ajit
Pai has proposed a rule change that will give certain non-coms new flexibility
in fundraising for third-party non-profits organizations. The new rule, if
enacted, will let some non-commercial educational (NCE) radio and TV stations
dedicate up to 1% of their “total annual airtime” to fundraising for
third-party non-profits.

However, the
proposed rule change specifically says that it does not apply to NCE stations
funded by the Corporation for Public Broadcasting (CPB). It appears to be a
“gift” to religious broadcasters. Pai said CPB-funded station could ask for a waiver.

The proposed rule will be discussed (and
perhaps voted on) at an open meeting of FCC Commissioners on April 20, 2017.

Backers of the rule
change say it will make fundraising easier for soliciting funds for disaster
recovery but the rule, as written, benefits a much wider group of non-profit
organizations.

Here is how Pai described the intent of the new rule in a blog
post:

We will also consider giving
NCE broadcasters more flexibility to raise money for disaster relief groups,
charities, and other
non-profit organizations. In the past, the FCC has granted waivers to
allow NCE television and radio stations to solicit donations for causes such as
Hurricane Katrina and Haitian earthquake relief. I believe that we should make
it easier for stations to engage in this type of activity so long as it doesn’t
compromise their non-commercial nature.

I’ve heighted the
phrase other non-profit
organizations because it appears to open the door to fundraising
for 501c3 organizations involved in advocacy concerning social issues. The National
Religious Broadcasters (NRB) has been lobbying for such a measure for over five
years.

Former NPR General
Counsel and President of the Sanchez Law Firm Ernie Sanchez says the proposed
rule gives noncom broadcasters are lot of latitude:

Ernie Sanchez

The FCC draft order is explicit that only
501c(3) organizations qualify. That includes most but not all churches because
some have chosen not to formally apply for IRS exempt status. In general they
are still allowed to claim non profit status under state law but without the
federal 501c (3) reporting requirements.

Organizations heavily into social causes
usually channel that activity into a 501 c (4) civic league. For example
the main ACLU is a 501c (4) but the ACLU Foundation is a 501c (3).

CPB-FUNDED
STATIONS CAN'T USE THE PROPOSED NEW RULE

If the new rule in
enacted there will be a new distinction between two types of NCE stations: One
for CPB-funded stations and the other for all other noncoms including religious
licensees.

Pai explained in
his bog post why stations funded by CPB do not qualify:

“Certain stations have
indicated that they have no interest in engaging in such fundraising activity
on behalf of third-party charities. The push for relaxing the limits has come
from – religious stations, and particularly the National Religious
Broadcasters.”

In other words,
because only religious broadcasters asked for the rule change, they are the
only organizations that can use it.

Over the past
several years, NPR has led a legal push back to the plan saying such a
change would result in listeners being inundated with requests from local
nonprofit groups, which in turn could affect station pledge drives. NPR has
instead said the FCC’s current system that allows a broadcaster to obtain a
temporary waiver to raise money in a specific instance strikes a better
balance.

CASE STUDY: HOW MUCH CAN A
NONCOM MAKE FOR A THIRD PARTY?

Lets take this
discussion into the real world: Assuming a station operates 24 hours a day, 365
days a year, one percent of programming time equals roughly 90 hours for
third-party fundraising.By
concentrating third-party fundraising in day parts when listening is high, the
third-party campaigns could last weeks.

American Family
Radio (AFR) based in Tupelo, Mississippi, is well known for its conservative
stand on various social and political issues. AFR [link] is owned by the American
Family Action (AFA), a 501c3 organization. AFA brought in revenue of
$29,790,000 in tax-year 2014, according to the most recent IRS data available.
Almost all of the revenue came from individuals.

AFR’s stated goal
to be a champion of Christian activism. They have this call-to-action
on their website:

If you are alarmed by the increasing
ungodliness and depravity assaulting our nation, tired of cursing the darkness,
and ready to light a bonfire, please join us. Do it for your
children and grandchildren.

This is a long way
from helping victims of Hurricane Katrina or a Jello Jump for Jerry’s Kids.

AFR currently
operates 156 full-power noncom stations and about 300 translator stations.Programming comes via satellite from Tupelo. As
you probably know, NCE translators can air programming delivered from
satellite. AFR feeds two national programming streams: Talk and dual-format
Talk and CCM.

AFR’s mission is to
inform, equip, and activate individuals to strengthen the moral foundations of
American culture, work that sometimes becomes political. AFR is currently a
leader of an effort to persuade Disney Studios to edit their film Beauty and the Beast. AFP wants Disney
to remove “a gay-oriented moment” in the movie.

AFR is pushing a
petition against Disney’s alleged pro-gay bias on all of its platforms.The petition is sponsored by Focus on the
Family, a Colorado-based 501c 3 organization. During its radio programs, AFR
stations are asking listeners to “flood the telephones lines of U.S. lawmakers”
to publically “shame” Disney.

What if AFR decided
to raise money for the effort? If Pai’s new FCC rule is approved, there is
nothing I am aware of that would stop them from using their entire national
network of stations and translators to raise money for the anti-Disney
campaign.